The oiled up paper filter will cause a rough idle. They are probably a better filter than the K&N, but get plugged pretty easy with oil, dust, pollen and moisture.
I haven´t found a paper gasket material thick and soft enough that I´ve felt comportable with, to use under the TB. I have put a thin coat of grease on the old TB gasket as a stop gap and made sure to realign the indentations from the TB on the old gasket, as a stopgap, until I could get a new gasket.
The crankcase ventilation system, is part of the emission system. In some areas, a serious thing to mess with. I´d make sure the 2.6MM (orifice) CCV tube is clear, blow through it, I´ve cleaned mine out with a very thin wire and solvent or buy a new one. And the CCV scavenger tube (the big one), is in good shape and hooked someplace above the TB.
There is a kit to hook up in the valve cover, to help keep fluid oil from being pulled into the scavenger tube. A plugged 2.6 MM CCV vent tube is most of the reason, the scavenger tube sucks oil into the filter box.
I guess theoretically, a filter mounted on the valve cover and a clean 2.6 mm line, will pull air through the filter on the valve cover (through the crankcase), through the 2.6 MM line with an oil vapor air mix, into the intake manifold to be burned. But at even mild throttle openings, the scavenger and the 2.6 MM CCV tube are both under vacuum, both probably help move oil vapor and moderate blowby into the intake system. I could be full of it, but have never bought the closed loop theory, that filtered air enters the large tube and exits the small tube at all throttle openings and vacuum. Maybe on a really fresh motor, not my old iron. IMO. At open throttle, manifold vacuum is pretty low, 2.6 MM doesn´t move much air, the engine generates just about max blowby, the vacuum goes up in the air box, the air voluum is higher and the so called cranckcase input air line (the big one hooked to the air cleaner) is probably sucking it´s share fumes out of the crankcase along with the 2.6 MM vent. IMO.
What I´m getting at, is on an old motor, when the throttle slams shut, cranlcase pressures, just may blow the filter off of your valve cover.